esther george was once considered an extreme hawk. a sign how much the fed has changed that these comments are really not that hawkish relative to others. carl. >> it is a good point, steve. thank you very much. steve liesman bringing us those comments from george. let's get to the cme group in the meantime, get the santelli exchange. hey, rick. >> hi, carl. you know, everybody is talking about it, the vicks near a quarter of a century low. but it really is not the vicks that's the issue. a few seconds ago i told you there's a group that predicted ultimately a computerized worlds of trading, markets would come to a halt and volatility would be very low. you know who that group was? human floor traders. i can remember many meetings in the early '90s where the notion of floor trading moved to the electronic media would in many ways end up with a stalemate. now, what does that mean? i'll tell you. i can go back to the early days of computer trading here in chicago, and what everybody did was bought these huge mounds of data on disks, dat

kansas city fed president esther george wants the balance sheet to shrink this year and thinks reductions should be put on auto pilot. as we've been reporting, investors will be watching for information on how and when the federal reserve unwinds its bond holdings, because the effect could be similar to an interest rate hike. >>> winding down the fed's bond portfolio would eliminate a major source of demand for long term treasury and other securities. an asset class warren buffett says as a terrible investment choice over stocks. here is what he told becky quick about bonds in an interview we aired for you yesterday. >> anybody that prefers bonds today to stocks is making a big mistake. i've been saying that year after year after year. >> dan heckman, senior fixed income strategist at u.s. bank wealth management, is here to discuss what you should do. a lot of people idolize warren buffett, dan. they think he knows a great deal, and certainly he does. and they might well think, well, gosh, maybe i should sell all my bonds. should they? >> no. we don't believe they should. obviously we hav

very quickly on esther george.he warns policy cannot move too gradually because, just like rosengren said, it's below the long-range rates. the fed should reduce the balance sheet this year. worth pointing out they used to be dove and hawk. they're now much closer together, a sign of really you nunanimous i amity on the board about the direction of policy. back to you. >> okay, thanks a lot, steve liesman. liz ann, let's bring that part, the headlines steve liesman was telling us about shrinking on the balance sheet and how these hawks and defenoves are finding middle ground. will that spike volatility later on this year? >> it's possible. if you look at the history of quantitative easing and you look at when we ended qe-1 but volatility picked up. the same thing between qe-2 and qe-3. you could argue that could be a catalyst in pickup in volatility when we get closer to year end, the time frame everybody's best guess now that we're getting from the fed that this would be probably a year end phenomenon. i wouldn't